K Raheja’s Mindspace raises Rs 100 crore in Indian Maiden REIT commercial paper | Jobs Vox


K Raheja Corp-backed Mindspace Business Parks REIT has raised more than Rs 100 crore in a commercial paper issue, the first such issue by a real estate investment trust in India since capital market regulator Securities and Exchange Board of India’s (SEBI’s) approval. This instrument was approved by REITs earlier this year.

The REIT raised short-term funds at an interest rate of 7.2% for a three-month maturity. The funds will be used for the working capital requirements of Mindspace REIT’s property special purpose vehicles.

In September, SEBI allowed REITs and Infrastructure Investment Trusts (InvITs) to raise funds by issuing commercial paper. This move has provided additional avenues for REITs to raise funds through short-term lease instruments with lower interest costs and faster time frames.

After successfully exploring capital market fundraising by issuing multiple debentures, we are pleased to be the first Indian REIT to raise funds through commercial paper. This is part of our larger strategy to diversify our credit base and reduce borrowing costs and maturity profile of our well-stacked debt book,” said Vinod Rohira, CEO, Mindspace Business Parks REIT.

According to him, as part of the REIT’s larger ESG commitment, it will also explore opportunities to raise funds by issuing green bonds.

In this issue, Mindspace REIT has further expanded its debt profile. At the time of the IPO, in August 2020, 100% of Mindspace REIT’s borrowings were in the form of bank loans at the property’s special purpose vehicle level.

Over the past two years, Mindspace Business Parks REIT has diversified its credit portfolio and underwritten its borrowing costs through a number of fixed-cost bonds, primarily mutual funds, pension funds and insurers. Mindspace Business Parks REIT, sponsored by K Raheja Corp, listed on Indian stock exchanges in August 2020. The REIT has office portfolios in four key office markets in India including Mumbai Metropolitan Region (MMR), Pune, Hyderabad and Chennai.

The REIT’s portfolio totals 31.9 million square feet and consists of five integrated business parks and five independent office properties. As of late September, it has a diverse tenancy with over 185 tenants.


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